The chairman of the Association of British Insurers working party for critical illness cover has put forward plans to scrap the total permanent disability definition. Total permanent disability has been a concern because it accounts for the highest proportion of unpaid claims. The proposed change includes creating a number of categories, breaking it up into main causes including stress, mental illness and back pain, with the aim of making it clearer to consumers.
Our view
We agree - this is a get out clause for many insurers. We welcome any new proposals although we suspect premiums will rise as a result of any change.